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Article Excerpt
The quality of nursing home care is an important policy issue, especially given the aging of the population. In response to concerns about persistent quality problems in the 1970s, Congress passed the Omnibus Budget Reconciliation Act (OBRA) of 1987, which raised minimum quality standards and strengthened federal and state oversight (Wiener 2003). Among various regulatory processes, minimum staffing standards have become a major subject for debate because of the importance of nurse staffing to the processes and outcomes of care (Harrington 2005a, b). The federal government strengthened national standards through the Nursing Home Reform Act (NHRA) as part of OBRA 87, which required nursing facilities to have (1) licensed nurses on duty 24 hours a day; (2) a registered nurse (RN) on duty at least 8 hours a day, 7 days a week; and (3) an RN director of nursing. Yet many nursing homes have had continuing quality problems despite the OBRA standards (GAO 1998, 1999, 2000).
Subsequently, many states mandated staffing standards, with some states pursuing a broad array of reforms to help providers recruit and retain a stable, well-trained workforce (PHI and NCDHHS 2004). By 2003, 36 states supplemented the federal guidelines with more stringent standards requiring either a certain number of nursing hours per resident day (HPRD) or a specified staff-to-resident or staff-to-bed ratio. From 1998 to 2001, 16 states implemented or expanded minimum staffing standards with the goal of improving quality of care.
While research has found that higher nursing home staffing leads to higher quality of care (Cohen and Spector 1996; Harrington et al. 2000), information on effects of recent changes in state staffing standards is scanty. Researchers and policymakers had contradictory comments about the use of staffing standards (GAO 2002). This paper investigates how changes in state-mandated staffing standards from 1998 to 2001 affected the level of staffing and quality of care.
BACKGROUND
Variation in State Minimum Staffing Standards
To participate in Medicare and Medicaid, nursing homes must meet federal and state standards. Compliance is monitored through the annual survey and certification process. Unless they apply for and receive an exemption, facilities that are not compliant with staffing standards receive a deficiency and are subject to sanctions (e.g., civil monetary penalties, denial of payment, or termination depending on the scope and severity).
Current federal staffing standards have not changed since 1987 and are far below the levels in many facilities (Zhang and Grabowski 2004; Harrington 2005a, b). State standards are more stringent than federal mandated levels, so more nursing homes may have to respond to the state standards than to federal standards. Furthermore, as states gained additional flexibility in determining state Medicaid policies with the repeal of the Boren Amendment in 1997, it is important to understand whether state mandated staffing standards affect staffing decisions and quality of care.
State staffing standards vary in terms of types of staff regulated and how standards are defined (Harrington 2002; DHHS 2003). Of the 36 states with standards, 29 set standards for total nursing staff and 27 states established direct care staff standards. Thirty-two states have licensed nurse requirements and nine states set specific RN requirements. Twenty-one states had staffing mandates defined as staff HPRD, six states set mandates in ratios, and nine states established standards in terms of both staff hours and ratios. While the details differ by state, 16 states made major changes to existing standards from 1998 to 2001 (Table 1). Fourteen states increased their standards, while two states implemented new standards. Three states (Arkansas, Delaware, and Oklahoma) made more comprehensive changes to requirements using a phase-in period to implement standards by shift and staff type. No state rescinded or lowered minimum requirement during the study period.
Prior Studies on Effects of Federal and State Minimum Staffing Standards
Several early studies examined the impact of federal staffing standards on nursing home staffing and quality of care. Janelli, Kanski, and Neary (1994) found that the implementation of federal standards in New York was associated with a decrease in restraint use that occurred largely without an increase in staffing. Moseley (1996) examined the 1990 implementation of NHRA legislation on catheter use among Virginia nursing home residents and found that post-NHRA catheterization rates were lower than the pre-NHRA rates. These studies, however, were based on simple pre- and postcomparisons in one or several states.
Zhang and Grabowski (2004) used national data and stronger methods to determine whether federal requirements led to higher quality. Using data from 5,092 nursing homes from 22 states linked across the pre-NHRA (1987) and post-NHRA (1993) period, they examined whether changes in staffing were related to changes in quality before and after the federal standards. Their study, which used a first-difference approach while controlling for time-invariant factors across homes, did not find that NHRA was associated with better quality except in cases where facilities had substandard staffing in the pre-NHRA period.
Two studies analyzed the relationship between state staffing standards and staffing levels in nursing homes. Harrington (2005a, b) found that the median nurse staffing level in 2000/2001 was substantially higher than each state's staffing standards, though these assessments were based on simple comparisons. Mueller et al. (2006) found that facilities in states with high standards had somewhat higher staffing on average than states with no or low standards, whereas staffing levels in states with low standards were not significantly different from staffing in states without standards.
CONCEPTUAL FRAMEWORK
Nearly two-thirds of nursing homes are for-profit facilities (Grabowski and Norton 2006), which have strong incentives to choose the profit-maximizing levels of quantity and quality of care. Nonprofit facilities may have different goals from for-profit facilities but must operate efficiently to maintain financial viability under competitive circumstances and so may try to maximize profits (Konetzka, Norton, and Stearns 2004). Profit-maximization models have been widely used in studying nursing home quality of care in face of regulatory policies, including changes in payment method, payment level, and certificate of need legislation (Scanlon 1980; Nyman 1985; Gertler 1989; Cohen and Spector 1996; Konetzka, Norton, and Stearns 2004).
Within the profit-maximization model, nursing homes will produce quantity and quality of care up to the point where the marginal cost of improvement equals the marginal financial gain from doing so. Federal or state minimum standards serve as constraints for the quantity and mix of staffing chosen by facilities, so that in theory nursing homes can only choose staffing at or above the minimum regulation level (Cawley, Grabowski, and Hirth 2006). If a facility's staffing is below new standards, those facilities must increase their staffing to become compliant with new standards in the next period to avoid any penalty, or must apply for an exemption.
In reality, raising minimum staffing standards...
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